Looking for the best cryptocurrency debit card? In this guide, we’ll break down the best options for investors based on factors like cashback rewards, fees, and availability by region!
What about the Binance Card?
While the Binance Card was previously on this list, Binance discontinued the card for the European Economic Area in December 2023. Because the card is currently not available in the United States and most of Europe, we decided to remove the Binance Card from our top 5.
What factors did you use to determine your ratings?
The CoinLedger team looked at dozens of cryptocurrency debit cards on the market to determine this list. We based our rankings on the following factors:
- Reputation of issuing platform/exchange
- Rewards
- Availability by region and country
- Customer support
- Security features
- Relevant fees
- Spending/transfer fees
- Spend and withdrawal limits
- Supported cryptocurrencies
How do crypto debit cards work?
Cryptocurrency debit cards are designed to make it easy for you to use your cryptocurrency holdings for real-world purchases.
Cryptocurrency exchanges partner with companies like Visa and MasterCard to make sure that your crypto debit card is accepted by the vast majority of vendors and merchants.
Here’s how crypto debit cards work:
- Load your card with a set amount of cryptocurrency.
- When you make a purchase, the card will automatically convert your cryptocurrency to fiat currency, then transfer the cash to the seller.
Are crypto debit cards safe?
Cryptocurrency debit cards are safe to use.
Cards like the Coinbase Card come with features like two-factor authentication, account freezing, and the ability to change your PIN from your mobile app. Debit cards require you to provide Know Your Customer information to prevent fraud.
Pros and cons of crypto debit cards
Let’s walk through some of the pros and cons of crypto debit cards.
Pros:
- Spend cryptocurrency on everyday purchases!
- Earn crypto through cashback rewards!
- Low fees compared to other types of cards!
Cons:
- Spending crypto is a taxable event.
- Must keep your debit card supplied with cryptocurrency to spend.
Can I replace my normal debit card with a crypto debit card?
You can use a crypto debit card to effectively replace your traditional debit card. However, you should consider your own unique situation before replacing your traditional debit card with a crypto debit card.
Crypto debit cards often offer higher rewards than traditional debit cards. Unlike traditional debit cards, you may incur capital gains or losses when you make purchases with a crypto debit card (more on this later in the article).
Can I get a crypto debit card with no KYC?
All of the debit cards listed in this article require customers to fill out KYC (Know Your Customer) information before opening a debit card. It’s unlikely that you’ll find a reputable crypto debit card provider that doesn’t require KYC.
Should I get a crypto debit card or credit card?
Let’s walk through the pros and cons of credit cards over debit cards.
The pros and cons of crypto credit cards
Pros:
- Build Credit: Credit cards can help users build their credit scores!
- Rewards: Credit cards also offer generous cashback rewards!
- Disputes: It’s typically easier to dispute and get refunded for a credit card charge compared to a debit card charge.
Cons:
- Credit Checks: Credit cards often require a credit check to get started, which can be a barrier for some users.
- Interest Rates: Credit cards charge interest on unpaid balances, which can add up over time.
- Potential Fees: Like debit cards, credit cards come with annual fees and other charges.
The Gemini credit card is a popular option for crypto credit card users — the card offers benefits like 3% cashback on dining!
How to choose a crypto debit card
Here are some factors you should consider before opening a crypto debit card.
Rewards: Before you choose a crypto debit card, you should understand the cashback reward rate and other potential perks and benefits you can receive.
Fees: Understand what fees your crypto debit card charges before you get started. It’s possible that you may be charged liquidation, foreign transaction, and/or withdrawal fees.
Convenience: Many investors choose debit cards based on convenience. For example, it may be easy for an existing Coinbase user to get started with the Coinbase debit card rather than opening an account with another exchange.
Tax implications: You should research whether your debit card comes with tax implications. Some cards allow you to make purchases with stablecoin — reducing the potential capital gains impact!
Supported cryptocurrencies: Make sure that your crypto debit card is compatible with the cryptocurrencies that you’re planning to use!
Reputation: Take a look at third-party reviews on sites like Trustpilot to see what users are saying about the debit card you’re interested in!
How are crypto debit cards taxed?
When you convert crypto to fiat currency, you’ll incur a capital gain or loss depending on how the price of your crypto has changed since you originally received it.
Crypto debit cards work by converting cryptocurrency to fiat currency at the point of sale. This means making purchases on a crypto debit card will be subject to capital gains tax.
To minimize taxes, many investors choose to fund their debit cards with stablecoin. Because stablecoins are pegged to the US dollar, the associated capital gain from a disposal will be close to ‘0’.
Are cashback rewards taxed?
Based on previous IRS guidance, crypto cashback rewards will likely be considered a non-taxable rebate. However, your cashback rewards will be subject to capital gains tax upon disposal.
To better understand how your debit card is taxed, check out our guide to crypto debit card taxes.
